MoviePass not raising price, will limit users to 3 movies a month instead

August 6, 2018

MoviePass not raising price, will limit users to 3 movies a month instead

CLEVELAND, Ohio -- MoviePass is changing course. Again.

In what appears to be a last-ditch effort to prevent subscribers from dropping it en masse, the movie subscription service said Monday it will not raise prices as previously announced, but instead restrict users to three movies a month.

Subscribers currently have access to up to a movie per day, though surge pricing and disappearing showtimes has made that nearly impossible over the last couple of weeks.

The change begins August 15. For the same $9.95 they pay now, subscribers will get three movies per month. People who sign up won’t have to pay “peak pricing” for high-demand films or submit photos of their tickets for verification, and will get up to a $5 discount for movies above the allotted three tickets per month.

Last week, MoviePass announced it would be changing its price to $14.95 a month.

“We have heard – and we have listened to – our MoviePass Community and we will not be raising prices to $14.95 a month,” the company said in a press release. “The new plan is focused on usage by the bulk of our subscribers who have historically used MoviePass to attend three movies or fewer a month.”

What isn’t clear: if MoviePass plans to continue preventing users from watching big blockbusters during the first two weeks of release. “The new plan will include many major studio first-run films,” the company says in a press release.

“We are well aware that during our journey to innovate moviegoing — a form of entertainment that over time has become unaffordable and broken — we’ve encountered many challenges. However, any industry-wide disruption like MoviePass requires a tremendous amount of testing, pivoting, and learning,” said MoviePass CEO Mitch Lowe in a statement. “We discovered over several months of research that our customers value a low monthly price above nearly everything else, so we came together to create a plan that delivers what most of our loyal MoviePass fans want, and one that, we believe, will also help to stabilize our business model.”

That business model -- which critics have called unsustainable -- is built around MoviePass paying full price for each ticket purchased by its three million members, with that cost subsidized through deals with theaters and movie studios and, possibly, the sale of subscribers’ data.

The company has come under fire in recent weeks for blocking members from using the service by imposing surcharges for popular (and not so popular) movies or removing films and showtimes from the app during busy times. Two weeks ago, MoviePass ran out of money, causing the service to go dark until it was able to secure a $5 million emergency loan.

The new plan hasn’t had much of an effect on parent company Helios & Matheson’s stock price, which is up to 0.10 from its opening price this morning of 0.072.

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